“Experimental” DeFi project raises $76 million in an hour after launch

Unaudited and positioned as an experimental DeFi protocol, Yam sparked frenzied demand among ‘yield farmers’.

According to The Block, within an hour of operation the value of assets locked in the project’s liquidity pools reached $76 million.

“Yam is a minimally viable monetary experiment; at launch the YAM token had zero value. Going forward its value depends entirely on its holders,” explained in the блоге by its founders.

The developers noted that the protocol had not undergone an audit, although in ten days from idea to implementation they sought to maximise the security of the smart contracts.

“We strongly urge caution to anyone who decides to use smart contracts. It is highly advisable to conduct a proper professional audit if the project is to be applied at a meaningful level,” warned representatives of the new project.

Yam drew criticism from Messari analyst Ryan Watkins, who compared it to a blend of Ampleforth’s ponzinomics, the idea of a YFI token with zero financial value, and the DeFi version of Dogecoin Tendies.

YAMs = Ponzinomics of AMPL + Chad launch of YFI + Meme math of Tendies

— Ryan Watkins (@RyanWatkins_) August 12, 2020

Erik Voorhees, the head of ShapeShift, expressed the view that Yam — seen as a scam — does not contribute to the development of the DeFi space.

$YAM looks like a scam… or to be more charitable, fairly transparent pump and dump nonsense.

Projects like this are not going to be good for defi…

What am I missing? Are the buyers willing participants in a silly game, or are people alleging actual value?

— Erik Voorhees (@ErikVoorhees) August 12, 2020

As of writing, the cumulative value locked in DeFi services neared $4.5 billion. The most popular asset remains Maker, whose dominance index is above 30%.

The Yam protocol uses a flexible-supply token model similar to Ampleforth. Liquidity providers are invited to contribute in eight staking pools the following assets: COMP, LEND, LINK, MKR, SNX, WETH, YFI and ETH/AMPL Uniswap v2 LP tokens. Two million YAM tokens are distributed evenly among them.

The opportunity for yield farming will be available for seven days. After the distribution ends, users will be able to contribute YAM tokens to Uniswap as liquidity to participate in the long-term ecosystem.

The next distribution round is expected to allocate 3 million tokens in the YAM/yCRV Uniswap v2 pool. In the first week — 1.5 million tokens, with this amount halving every subsequent seven days.

Two token clones of the yEarn Finance project devalued, failing to attract the hype of the original. Another project was accused of an exit scam.

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